# Stochastic Volatility

*Quant & Pricing — Finicade finance glossary*

Modelling volatility as itself random and mean-reverting, rather than fixed. It captures why markets have calm and turbulent spells — and why option smiles look the way they do.

**Also known as:** local-stochastic-vol, stochastic vol

**Related terms:** [Volatility Smile](https://finicade.com/glossary/volatility-smile-skew), [Local Volatility](https://finicade.com/glossary/local-volatility), [Implied Volatility](https://finicade.com/glossary/implied-volatility)

**Taught in:** Quant Quest — Local & Stochastic Volatility

Source: https://finicade.com/glossary/stochastic-volatility